Summary
The MFSA is currently finalising guidelines on the introduction of cross sub-fund investments in the Investment Services Rules for Professional Investor Funds targeting Qualifying and Extraordinary Investors.
cONTINUE rEADING
The MFSA is currently finalising guidelines on the introduction of cross sub-fund investments in the Investment Services Rules for Professional Investor Funds targeting Qualifying and Extraordinary Investors.
The inclusion of the these rules is being proposed by the local authority in order to allow a sub-fund to be able to invest in units of one or more sub-funds within the same scheme subject to the following conditions:
- the sub-fund is allowed to invest up to 35% of its assets into another sub-fund or sub-funds within the same scheme;
- the target sub-fund/s may not themselves invest in the sub-fund which is to invest in the target sub-fund/s;
- in order to avoid duplication of fees, only one set of management, subscription and/or redemption fees applies between the sub-fund and the target sub-fund where the manager is the same or (in the case of different managers) where one manager is an affiliate of the other;
- for the purposes of ensuring compliance with any applicable capital requirements, cross-investments will be counted once;
- any voting rights acquired by the sub-fund from the acquisition of the units in the target sub-fund shall be disapplied as appropriate.
The proposed regulations are bound to introduce yet even more flexibility into the applicable legal regime.
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